Doug Henwood wrote:
> Wojtek Sokolowski wrote:
>
>>But if we think outside the box, unions are also big investors thanks to
>>their pension funds. Why not investing these money into creating
>>enterprises with social responsibility that do not race Western firms to
>>the
>>bottom?
>
> That would probably be illegal in the U.S.
>
> Doug
------------------------
That is only half of it. The other half of it is that, even when legal,
their managers still chase the highest returns, after proper lip-service is
given to "social responsibility."
For example, the most successful union-run plan (rather, union-partnered since the provincial government is also a party) is the Ontario Teachers' Pension Plan. It has grown spectacularly through well-timed real estate and other investments, and has received plaudits from the financial press internationally. The OTPP is also publicly committed to "socially responsible investing" and encourages "companies to develop policies and practices to address issues of social responsibility that are relevant to their businesses, including:the environmental impact of the company's products and operations..." etc. (See http://www.otpp.com/web/website.nsf/web/Guidelines_SocialResponsibility)
Yet only last year, Greenpeace and the Sierra Club condemned the plan for being Canada's largest investor in coal, with extensive other fossil fuel holdings as well as investments in tobacco. It is not unique; go through the holdings of any "socially responsible" investment fund, and, even when the holdings are not as egregiously offensive as coal and tobacco companies or arms manufacturers, you will unearth multiple examples of companies who are not unionized or who have poor labour or consumer relations or who are tax or accounting cheats or who have hurt the public interest in some small or large way. There really is no such thing as a "socially responsible" company; their first responsibility is to their shareholders.
I don't know of any pension plans democratically run by their members in the sense that investment decisions are subject to close and regular oversight, but it seems likely that even if there were, it wouldn't much change things. Except for a small minority of politically-conscious activists, most unionized plan members judge their plans on the basis of their financial rather than ethical performance; they want maximum returns to both lower their contribution rates and improve their retirement benefits.
In any event, does Wojtek really believe that even given their billions in assets union pension plans can have a decisive effect on the structure and behaviour of the world's leading multinationals or the movement of trillions of dollars all over the world such that it can stop the flight of capital from higher-wage areas to lower ones? I'd be surprised if he did.
MG